Life of a well

Drilling

The well is created by drilling a hole 5 to 30 inches (13 – 76 cm) diameter into the earth with an oil platform which rotates a drill bit. After the hole is drilled, a steel pipe (casing) slightly smaller than the hole is placed in the hole, and secured with cement. The casing provides structural integrity to the newly drilled wellbore in addition to isolating potentially dangerous high pressure zones from each other and from the surface.

With these zones safely isolated and the formation protected by the casing, the well can be drilled deeper (into potentially more-unstable and violent formations) with a smaller bit, and also cased with a smaller size casing. Modern wells often have 2-5 sets of subsequently smaller hole sizes drilled inside one another, each cemented with casing.

To drill the well,

The drill bit, aided by the weight of drill string and drill collars above it, breaks up the earth.

-Drilling fluid (aka "mud") is pumped down the inside of the drill pipe and exits at the drill bit and aids to break up the rock, keeping pressure on top of the bit, as well as cleaning, cooling and lubricating the bit.

-The generated rock "cuttings" are swept up by the drilling fluid as it circulates back to surface outside the drill pipe. The fluid then goes through "shakers" which strain the cuttings from the good fluid which is returned to the bit. Watching for abnormalities in the returning cuttings and volume of returning fluid are imperative to catch "kicks" (when the pressure below the bit is more than that above, causing gas and mud to come up uncontrollably) early.

-The pipe or drill string to which the bit is attached is gradually lengthened as the well gets deeper by screwing in several 30-foot (10 m) joints of pipe at surface. Usually joints are combined into 3 joints equaling 1 stand. Some smaller rigs only use 2 joints and newer rigs can handle stands of 4 joints.

This process is all facilitated by a drilling rig which contains all necessary equipment to circulate the drilling fluid, hoist and turn the pipe, control downhole pressures, remove cuttings from the drilling fluid, and generate onsite power for these operations.

Completion

After drilling and casing the well, it must be 'completed'. Completion is the process in which the well is enabled to produce oil or gas.

In a cased-hole completion, small holes called perforations are made in the portion of the casing which passed through the production zone, to provide a path for the oil to flow from the surrounding rock into the production tubing. In open hole completion, often 'sand screens' or a 'gravel pack' is installed in the last drilled, uncased reservoir section. These maintain structural integrity of the wellbore in the absence of casing, while still allowing flow from the reservoir into the wellbore. Screens also control the migration of formation sands into production tubulars and surface equipment, which can cause washouts and other problems, particularly from unconsolidated sand formations in offshore fields.

After a flow path is made, acids and fracturing fluids are pumped into the well to fracture, clean, or otherwise prepare and stimulate the reservoir rock to optimally produce hydrocarbons into the wellbore. Finally, the area above the reservoir section of the well is packed off inside the casing, and connected to the surface via a smaller diameter pipe called tubing. This arrangement provides a redundant barrier to leaks of hydrocarbons as well as allowing damaged sections to be replaced. Also, the smaller diameter of the tubing produces hydrocarbons at an increased velocity in order to overcome the hydrostatic effects of heavy fluids such as water.

In many wells, the natural pressure of the subsurface reservoir is high enough for the oil or gas to flow to the surface. However, this is not always the case, especially in depleted fields where the pressures have been lowered by other producing wells, or in low permeability oil reservoirs. Installing a smaller diameter tubing may be enough to help the production, but artificial lift methods may also be needed. Common solutions include downhole pumps, gas lift, or surface pump jacks. The use of artificial lift technology in a field is often termed as "secondary recovery" in the industry. Many new systems in the last ten years have been introduced for well completion. Multiple packer systems with frac ports or port collars in an all in one system have cut completion costs and improved production, especially in the case of horizontal wells. These new systems allow casings to run into the lateral zone with proper packer/frac port placement for optimal hydrocarbon recovery.

Production

The production stage is the most important stage of a well's life, when the oil and gas are produced. By this time, the oil rigs and workover rigs used to drill and complete the well have moved off the wellbore, and the top is usually outfitted with a collection of valves called a wellhead. These valves regulate pressures, control flows, and allow access to the wellbore in case further completion work is needed. From the outlet valve of the wellhead, the flow can be connected to a distribution network of pipelines and tanks to supply the product to refineries, natural gas compressor stations, or oil export terminals.

As long as the pressure in the reservoir remains high enough, the wellhead is all that is required to produce the well. If the pressure depletes and it is considered economically viable, an artificial lift method mentioned in the completions section can be employed.

Workovers are often necessary in older wells, which may need smaller diameter tubing, scale or paraffin removal, acid matrix jobs, or completing new zones of interest in a shallower reservoir. Such remedial work can be performed using workover rigs – also known as pulling units to pull and replace tubing, or by the use of a well intervention technique called coiled tubing.

Enhanced recovery methods such as waterflooding, steam flooding, or CO₂ flooding may be used to increase reservoir pressure and provide a "sweep" effect to push hydrocarbons out of the reservoir. Such methods require the use of injection wells (often chosen from old production wells in a carefully determined pattern), and are used when facing problems with reservoir pressure depletion, high oil viscosity, or can even be employed early in a field's life. In certain cases – depending on the reservoir's geomechanics – reservoir engineers may determine that ultimate recoverable oil may be increased by applying a waterflooding strategy early in the field's development rather than later. Such enhanced recovery techniques are often called "tertiary recovery".

Abandonment

When the well no longer produces or produces so poorly that it is a liability, it is abandoned. In this process, tubing is removed from the well and sections of well bore are filled with cement to isolate the flow path between gas and water zones from each other, as well as the surface. Completely filling the well bore with cement is costly and unnecessary. The surface around the wellhead is then excavated, and the wellhead and casing are cut off, a cap is welded in place and then buried.

The production from an oil well declines in production. The point at which the well no longer makes a profit and is plugged and abandoned is called the “economic limit.”

The equation to determine the economic limit contains four factors, namely: (1) taxes, (2) operating cost, (3) oil price, and (4) royalty. When oil taxes are raised, the economic limit is raised. When oil price is increased, the economic limit is lowered.

When the economic limit is raised, the life of the well is decreased. Proven oil reserves are lost when the life of an oil well is decreased.